The URL bar ("omnibox"), despite its appearance, is a weird hybrid of
a text box and something else. IP addresses are what computers
understand while words (search terms) are what humans understand. The
omnibox attempts to span the two simultaneously, transiently switching
between searches and URLs, prefetching DNS as you type.

Well, there are two use cases for copy and paste. If I select a word
out of my URL bar and paste it into this post, I expect the word to
come through -- the human interpretation of the URL. But then if I
want to share this URL with a friend, I want to select the entire URL
and paste it in its machine-readable form, with the escapes -- the
machine interpretation of the URL.

So that is what we do: selecting portions of the URL copies it in the
human-readable form, while selecting the entire URL copies it in its
underlying machine representation. This seemed entirely crazy to me
when I first learned about it but I had never noticed it until it was
pointed out to me and I confirmed Firefox does it too.

(Why not just always use the human-readable form everywhere? I dunno.
I guess you'd need to mandate UTF-8 only, otherwise it'd be unclear
what sequence of bytes a given string of Unicode produces, which I
think is probably ok because that's what browsers currently assume;
but even then I worry about normalization forms and sites that use
non-UTF-8 byte strings in their query parameters. I wonder what
we and other browsers do with Big5 in a URL?)

This is the reason I'm not too concerned with the news we're dropping
the http:// prefix from URLs using that protocol. It's already what
browsers assume on input from an unprefixed URL, since users never
type them anyway (though our Strict Transport Security has
allowed sites to opt into HTTPS instead). And copy and paste should
work as before since we're already doing special behavior for it.
(What about X selections? The fact that they currently behave
differently is just a bug, nothing more. I'm a little surprised it's
not going down the same code path.)